Greenwood Leflore Hospital says it could close in two months even while it continues to negotiate a deal for another health-care system to take over the financially teetering hospital, which is also considering bankruptcy.
Hospital employees were notified by letter on Monday that GLH “will cease operations and close on June 15, 2026,” although an accompanying memo clarified that the anticipated closure could be postponed depending on subsequent developments.
The letter was issued in order to comply with the federal Worker Adjustment and Retraining Notification (WARN) Act, which requires employers with 100 or more full-time employees to provide at least 60 days’ advance written notice of a potential closure.
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“The date reflects compliance with federal law, not a guaranteed closure,” said the hospital administrative staff in an email to the Commonwealth. “The hospital is taking necessary steps to preserve essential medical services for the hospital’s service area while meeting all legal requirements.
“The hospital’s priority is to maintain critical services for the community. Beyond those services previously eliminated, all other lines will remain.”
Hospital administrators also said the June 15 date is based on financial projections developed “in preparation for a potential Chapter 9 bankruptcy filing and reflects court-related requirements.”
The Mississippi Legislature passed a bill in March to allow Greenwood Leflore Hospital to file for Chapter 9 bankruptcy. It became law without the signature of Gov. Tate Reeves. Although the hospital had not entered bankruptcy as of Tuesday morning, the WARN letter may indicate the possibility of a filing soon.
“While there are no guarantees, filing for bankruptcy does not mean the hospital will close,” the administration’s email stated. “Bankruptcy will serve as a tool to stabilize operations by restructuring debt and addressing unprofitable contracts, with the goal of continuing to serve the community.
“We have been advised in bankruptcy proceedings, employee wages and payroll-related expenses are a priority for payment by the court.”
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Greenwood Leflore Hospital has been struggling for several years to offset losses that have severely depleted its cash reserves.
Its most recent crisis was triggered by clawbacks from the state Division of Medicaid of millions of dollars in supplemental payments to the hospital.
Medicaid ruled that the Greenwood hospital had been overpaid more than $5 million in 2024 and 2025 from the Mississippi Hospital Access Program because those payments had been based on patient volumes prior to the hospital’s cost-cutting reductions in services.
The Commonwealth obtained a copy of Monday’s WARN Act letter, signed by Key Britt, vice president of administrative services, and the memo to employees.
“In the short term, the hospital continues to seek relief from Medicaid recoupments announced in June 2025,” the memo stated. “To date, Medicaid has recouped $2.5 million in payments that would otherwise have been received by the hospital. An additional $5.0 million remains at risk. The hospital is actively challenging these recoupments through administrative processes and court proceedings.”
Recoupment payments were halted in December 2025 by a Hinds County chancery judge. In March, the judge affirmed that decision to stop recoupments, but that relief was not enough to reverse the hit to the hospital’s cash reserves.
According to the February financial statement, the hospital has accumulated a net loss, not counting depreciation, of $3.56 million for the first five months of the current fiscal year. The hospital had only $2.19 million in cash reserves. To date, total revenues are down nearly $4.4 million compared to the same point a year ago.
MHAP had been a lifeline for the hospital. After the federal government approved a revision to the Medicaid supplement in 2023, the hospital received around $25 million before the clawbacks began. That and an infusion of $7.5 million from a line of credit secured by the Leflore County Board of Supervisors helped the hospital stay afloat. Its 2024 audit showed the hospital reducing its deficit from a $16.2 million loss in fiscal year 2023 to just over $1 million for 2024.
However, the 2025 audit showed that the hospital had a $13 million reduction in payments from MHAP due to the Division of Medicaid’s finding. It also reflects the reduced patient volume due to the closure of the hospital’s labor and delivery unit and cuts to other services.
This is why hospital officials said they are in negotiations with a large health-care system to transfer all of GLH’s services to that organization. It was reported by Mississippi Today that the University of Mississippi Medical Center was that organization. This would be the third time UMMC has been in negotiations with Greenwood Leflore Hospital since 2018.
“The goal is to complete this transaction later this summer,” the memo stated. “These recoupments are significantly affecting the hospital’s ability to fund its operations, and there is no guarantee that negotiations with the larger system will be successful. To help ensure the hospital can continue providing services during this period, a Chapter 9 bankruptcy filing is under consideration. This step would allow operations to continue while efforts to complete a transaction are ongoing.”
Hospital officials also said in the email to the Commonwealth, “Changes in financial conditions, operational performance or developments related to bankruptcy proceedings or potential partnerships could result in a revised date.”
“The hospital reserves the right to amend the WARN Act notice and revise the effective date as additional information becomes known and as it continues to assess its financial condition,” the memo continued. “This assessment includes the potential positive impact of bankruptcy on preserving cash reserves, fluctuations in inpatient admissions and outpatient visits and their associated revenues, the timing of payments from government programs, and the availability of new financing sources.”
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The memo and a similar WARN Act letter were also sent to Greenwood Mayor Kenderick Cox, Leflore County Administrator Cynthia Stanciel, Board of Supervisors President Eric Mitchell, District 5 Supervisor Robert Collins and Greenwood City Council President Ronnie Stevenson informing them of the possible closure. The hospital is jointly owned by the city of Greenwood and Leflore County.
Reeves and the Mississippi Department of Employment Security were also sent a copy of the letter.
“I am writing on behalf of the Board of Trustees of Greenwood Leflore Hospital to inform you that the Greenwood Leflore Hospital (located at 1401 River Road, Greenwood, Mississippi) and all of its associated facilities will cease operations and close on June 15, 2026,” Britt said in the letter to officials. “This closure will affect substantially all employees (approximately 425) and is expected to be permanent. Those employees are expected to be permanently separated from employment effective June 15, 2026. All affected employees have been notified of this closure and their separation date by correspondence dated today.”
Hospital administrators also told the employees in the memorandum, “We want to express our deepest gratitude to every member of our hospital workforce for your unwavering commitment during these challenging financial times. Your dedication, resilience, and compassion have ensured that our patients continue to receive the care they need, even in the face of uncertainty. Thank you for your loyalty, your perseverance, and the vital role you play every single day.”
- Brent Maze is the editor and publisher of The Greenwood Commonwealth. Contact him at 662-581-7243 or bmaze@gwcommonwealth.com.
